Upload
others
View
2
Download
0
Embed Size (px)
Citation preview
Biennial Budgeting
Prepared by
Steven King Jim MacKenzie Chaz Vaughn
PADM 628
Dr. Greg Protasel April 27, 2005
Page 1
Special thanks to
Diana Pearcy
Director of the Municipality of Anchorage’s Office of Management & Budget
&
Craig Duncan
Finance Director, City & Borough of Juneau
For their assistance & support in the completion of this project
Page 2
A biennial budget is a document that authorizes a government’s appropriations,
planned expenditures, and anticipated revenues for two consecutive budgetary
years. Two commonly used types of biennial budgets are:
Traditional biennial budget: These budgets include both the spending plan and
the revenue plan for both budgetary years and are approved together.
Rolling biennial budget: These budgets consist of an additional financial plan
that serves as the tentative spending plan for the non-budget development
year. This results in the first year’s appropriations being formally adopted,
whereas the subsequent year’s appropriations are not. This system serves to
allow for a safety net in the case of substantial unforeseen impacts on the
budget prior to the start of the second year; if nothing drastic occurs within that
first year then the budget for the following year is already completed and only
needs to be formally adopted (Guajardo, An Elected Official’s Guide to MULTI-YEAR
BUDGETING, 2000).
The biennial budget has received a lot attention in Washington over the past
decade. Since 1977 more than forty congressional or special committee hearings
have addressed the topic. During the Hearing of the Committee on Rules on
2/16/00 (U.S. House of Representatives, 2000) the proponents of the system argued
the enactment of a biennial budget process could lead to the most significant
government wide fiscal management reforms of the last quarter century. They
claimed that the enormous amount of resources expended by the executive
branch in preparing multiple annual budgets would be diverted to long term
strategic planning and improving the performance of Federal programs.
The fundamental reason stated for adopting a biennial budget was to provide more
time for oversight of agency operations and to give greater lead time for budget
and appropriations decisions. They were also convinced that for those citizens
served by Federal programs, biennial budgeting would provide more predictability
Page 3
and peace of mind. States, localities and private organizations would become
more efficient in the long term planning and management of their programs if
Federal funding streams were more predictable.
Ultimately the proponents of the new structure concluded that biennial budgeting is
not a panacea for all the ailments of society or the Federal Government. However,
they state that if the process is implemented and managed correctly it can promote
a more effective government and a less chaotic and repetitive budget process.
The opponents of the plan responded by pointing out that in 1940 forty-four states
had biennial budgets and now only twenty-one have them. They claimed that the
states found that by having biennial budgets it led to more supplemental budgets
and less oversight by the legislature. They also doubt that it is a more efficient
system. They claim that states that have adopted the biennial budget still perform
substantial annual reviews to balance their budgets (U.S. House of Representatives,
2000).
The opponents concluded that the act of changing to a biennial budget is a
cosmetic remedy that serves no real purpose beyond disguising the actual
budgetary problems and distracting attention away from the development of
meaningful solutions. They dispute the referenced improvements in oversight by
stating that the core problem with oversight is that nothing is done as a result of it,
not that the timing is off or that a lack of consolidation is inherent in an annual
budget system.
Opponents of the biennial system citing it as a cosmetic solution contend that what
is lacking in governments is a steady, consistent management purpose and some
even go so far as to accuse some stakeholders of wanting to lead the latest wave
in management thinking, without stopping to consider the possibility that the latest
may in fact be flawed or even completely irrelevant.
Page 4
Laszlo Bockh and Mary Blakeslee (1998-2004) took this line of thinking a step
further when they stated: “There will always be a time constraint and the only
reason anything gets done is that there is an absolute deadline. Behavior in this
respect will not change. Look at what happened when the Federal fiscal year was
moved by three months in 1975, going from a July to June fiscal year to the
current October to September system- it simply made more time available for
evading the issues. And there were subcommittee chairs that did manage to get
all their work done on time. So it is humanly possible to stick to a schedule if you
in fact want to. I suspect that the biennial budget will give Congress one year and
eight months to avoid budget issues as opposed to the current eight months.”
Regardless of how the biennial budget addresses applicable problems, and
barring the cost benefit analysis, all parties agree that it is a difficult task to initiate.
And within the context of the above discussion of biennial budgets on the federal
level a great amount of thought, research, and implementation has occurred on
the state and local levels. The pros and cons of the biennial system, as well as
development, implementation, and maintenance issues tend to remain fairly
consistent across these varying degrees of government (National Advisory Council
on State and Local Budgeting, 1998).
Even in light of the opposition and implementation challenges as referenced
earlier, there is still a great deal of interest on the part of local, state, and federal
public policymakers towards the adoption of biennial budgets.
Their reasons for doing so vary but they generally share in common the desire to
improve financial, budget, and strategic planning practices and processes and to
strengthen the linkage between various management and financial policy and
budget documents. They also hope to cause a reduction in staff time allocated to
budget development by placing a greater emphasis on achieving long-term goals
and objectives. Biennial budgets are adopted in order to address budgetary
concerns that are not being met by an annual budgeting process.
Page 5
Proponents of the biennial budget contend that some, perhaps many, issues could
be addressed without adopting a new system. However, they are convinced that
the following issues: Improving financial management; Improving long-range and
strategic planning; Improve program monitoring and evaluation; and linking
operating and capital activities and spending, - can be brought to the forefront by
requiring department directors and their budget officers to systematically address
each activity during budget development. In addition they have determined that
the biennial budget process reduces opportunism to increase department, division,
and/or unit budget appropriations from year to year. It also reduces the amount of
staff time dedicated to budget development, which permits the reallocation of staff
to other functions and activities (Guajardo, An Elected Official’s Guide to MULTI-YEAR
BUDGETING, 2000).
Two of the main reasons that opponents discourage the adoption of a biennial
budget are that budgets function in uncertain environments and that new systems
are often difficult and cumbersome to get started. Ongoing economic and
environmental changes present difficulty in forecasting revenues and expenditures
and this difficulty is often compounded depending on the culture, structure, and
operating conditions of some individual divisions, departments, and/or units.
Some of the difficulties in establishing a biennial budget often include:
The need for new legislative acts and resolutions;
The increased difficulty in this could come from the perception of a loss of
oversight and budgetary control for the legislative body.
A fostering of staff turnover due to unbalanced workload (i.e. increased
workload during budget development period).
The budget process would need to include new policies and procedures.
This would almost certainly need to include new timing for oversight and
auditing functions.
Page 6
Governments considering the adoption of a biennial budget have learned to
counterbalance its potential disadvantages by amending current budgetary
policies and procedures as opposed to rebuilding the entire structure. This process
would include updates to working and budget manuals and the preparation of
budget staff well in advance of implementation.
Government officials would also do well to exam key economic and financial
indicators in assessing local economic environments, which would include an
analysis of existing and potential revenue structures. Once completed a
documentation process should be established to explore and determine key
economic and environmental assumptions.
Next, in order to get the project off the ground effective communication must be
established with key stakeholders. Those with an interest in the procedure must
see the connection between the biennial budget and long term financial and
strategic plans as well as revenue forecasts and financial and budgetary policies.
The development, implementation, and operation of a biennial budget generally
rely upon some basic assumptions about underlying expenditures and revenues.
Four basic expenditure assumptions:
1) Expenditures change over time incrementally.
2) Expenditures are easily controlled and sufficiently manageable.
3) Expenditures are predictable.
4) Significant crisis or extraordinary events are not common.
Four basic revenue structure assumptions:
1) Charges, user fees, and revenues in general are predictable.
2) Local and regional economies are stable.
3) Revenue structure and base are reliable.
4) A general consensus exists concerning revenue projections (Guajardo, An Elected Official’s Guide to MULTI-YEAR BUDGETING, 2000)
Page 7
With these assumptions considered, addressed, and accounted for
implementation becomes viable. However, in order to successfully implement a
biennial budget with the least amount of difficulties it is necessary to have a
foundation and bridge between the budget and various planning documents. To
successfully establish this environment it is recommended that conditions exhibit
clearly defined multi-year obligations and capital expenditures including long-term
priorities, goals, and objectives as well as strategic and financial planning. In
addition, budgetary controls, policies, and processes (including reporting and
monitoring polices and procedures) should be firmly established along with a
methodology applicable to revenue and expenditure forecasting (Sutberry, Biennial
budgeting in Washington cities and counties: Government finance review, August 1998).
Other key factors, particularly political, administrative, and policy and procedural,
must also be addressed when considering the implementation of a biennial
budget.
The political factors necessary to obtain the support from legislative members as
well as the mayor, city manager, executive director, etc. should be addressed by
the chief financial officer. The key stakeholders should be fully versed on the
need, rationale, and benefits of a biennial budget and it must be ascertained that
they understand the process. As part of assuring a full understanding of the
process it is necessary to include an exploration on who has the authority to adopt
and implement a different budget schedule and whether or not those individuals or
bodies view the transition as a threat to their budgetary oversight authority.
Another important consideration, especially in Anchorage, is whether or not the
biennial budget would coincide with the election cycle.
The administrative factors include determining the impact of the biennial budget on
existing fiscal and budgetary processes, existing programs and services, as well
as the existing monitoring system. The implementation time frame must be
estimated along with the amount of staff resources needed for the process and it
Page 8
must be determined how to achieve the coordination of all the key stakeholders
and involved staffs. Again, these issues can be best addressed through
information and education.
The policy and procedural issues that should be considered when implementing a
biennial budget include several determinations. Such as:
How will year-end fund balances between operation and capital budget be
reconciled?
How will transfers and reimbursements work?
How will staffing requirements be addressed?
How will budget amendments be carried out?
How will overruns and overspending be addressed (include with this revenue
shortfall policies and procedures)?
How will funding for unanticipated events be addressed?
How will projects be prioritized and incorporated into the budget?
Will fund transfers between budget years be allowed or will unexpended funds
be carried over into the next budget year?
And finally, what will budget cycle review policies and processes include?
The next section of this paper will explore how many of these issues were dealt
with by the city of Auburn, Alabama; it will examine the challenges they faced in
the course of implementing a biennial budget.
Auburn Implementation and Review
In 2000 the city of Auburn, Alabama began the steps necessary to convert from an
annual to a biennial budget for the 2001 - 2002 fiscal year. The following is a
review extracted from Government Finance Review August 2002. Andrea Jackson
who served as Auburn’s financial director during the transition is the author of the
review. Her article documented Auburn’s implementation process, the challenges,
and the results of their conversion. Highlights of that article are presented here for
analysis.
Page 9
Auburn is a council-manager government with a population of 43,000 and a
general fund budget of $35 million. At the city managers request, the finance
director was asked to look at preparing a biennial budget. The general intent was
to reduce the amount of time staff spent on budget preparation, publication and
review. The city did not have a separate budget office, so the finance office and
various employees from across the city departments were additionally tasked with
the budget process. During certain times of the year this process dominated the
work of the departments and represented a significant expenditure of time and
funds that could be spent in other important areas; the opportunity cost was
becoming too high.
Another objective of the city manager was to orchestrate extended planning and
increased coordination by all the municipal departments. The current process of
annually budgeting and correcting problems during the six-month review allowed
the departments to push problems down the road with the hopes that a windfall or
priority change would satisfy their department requests. This process was
counterproductive to long term planning.
It was hoped that improved long range planning in addition to smoothing budget
fluctuation would also provide the city with the benefit of better bond ratings. In
the 1990’s Auburn’s general fund levels had dropped as a result of multiple capital
improvement projects. By improving general fund levels, enhanced bond ratings
could be obtained. In good faith, the fund balance maintenance was specifically
tied to the development of the biennial budget as a strategic goal of the program.
A decision needed to be made as to the type of biennial budget to adopt and how
to take the first steps. A review of state law and a legal reading was required to
ensure Auburn’s actions would not violate state law. In Alabama the law requires
cities to adopt annual budgets and have annual financial audits. By selecting the
traditional biennial budget Auburn felt it met the intent of the law, which did not
prevent the city from adopting two annual budgets at the same time. The rolling
Page 10
budget was dismissed as an alternative because, in their opinion, it did not save
as much time as the traditional biennial budget.
The next step was to gain the support of key persons; namely those people
needed in order to make the new process succeed. This process includes
identifying and persuading the key stakeholders, namely the governing body, and
department directors. Since the city manager was obviously already on board, he
first met with department heads, which saw the potential reduction in man-hours
and staff time as a convincing benefit. With departmental head’s support the
intention was proposed to the city council.
Adoption of the new budget system came with assurances to the city council that
they would remain firmly in the budget loop. It was determined that any increases
in spending would still follow city ordinance, which requires council approval, and
that the council would continue to receive monthly budget reports in order to
maintain oversight of the process.
Challenges - An immediate crisis existed in the form of time compression. Since
the council approved of the new budget process in late April, the normal
preliminary work to meet timelines for budget processing was two months behind
schedule. Several products were now needed, but undeveloped. The biennial
compared to the annual timeline is presented in Table 1.
Page 11
Source: Andrea Jackson “Taking the Plunge: The Conversion to Multi-year Budgeting”
Additional challenges surfaced in three main areas:
1) Estimating personnel needs,
2) Forecasting revenues, and
3) Reviewing departmental budget requests.
Table 1
Page 12
The first two issues are faced during any type of budget development, but they
were further complicated by the second year of consideration (of course, the
further you forecast into the future the greater the likelihood of error).
Under the annual process the number of employees in each category, permanent,
part-time, and temporary or term was forecasted. This was speculative in many
cases such as the seasonal cycle of temporary employees. An additional manning
forecast issue became apparent when the city manager determined it was
necessary to include the cost of living increases that would be proposed to the
council for the budget window. Prior to this the cost of living increases were not
budgeted for and were added to the budget after approval by the council. This
impacted the general fund balance and was to be corrected by inclusion in the
budget forecasts. As one can imagine this was a difficult process for the human
resources department.
Revenue forecasting also became a challenge. Changes in revenue mix, or
significant reductions to expected revenues, would cause revisions and require
adjustments in spending and or appropriations. Again the extended forecast could
jeopardize accuracy. In Auburn’s case it had extensive revenue databases for the
last fifteen years it used to forecast revenues it termed “conservatively realistic”.
By being conservative in its estimates, the annual budget allowed for a safety
margin. Auburn used this safety approach when it adopted its second year budget
by exaggerating the conservative approach even further. An element that allowed
for corrections and alleviating some of the uncertainty to this approach was that
60% of the city’s revenues were received by midyear. As a result any significant
deviations could be corrected for without having to wait until the end of the year.
The third challenge was in the area of department budget requests. Although the
city followed the same general process it had used before to balance revenues
with spending (while maintaining an acceptable general fund balance) the process
was complicated by the second year. The department heads were giving spending
Page 13
limits for each year and allowed to make line item changes as long as they did not
exceed their budget amounts. For capital projects that could not be cut or
deferred, the city made provisions to borrow the necessary funds.
Results - Entering the second year of the budget, all department heads and staff
were in agreement that the biennial budget had met expectations. It had reduced
the amount of time staff spent in preparation and allowed those resources to be
spent on other priorities. The first mid-year review had required only minimal
involvement from the City manager, and the Finance department indicating
revenue forecasts were valid. The previously tasked workers and department
heads were not required to participate. At the end of the first year the required
staff reviewed and adopted the second year budget with minimal changes instead
of creating a new budget from scratch. This resulted in a significant resource
savings for the council and city workers.
The requirement to forecast further into the future had forced a shift in paradigm
for the departments. In addition to looking at greater details to make spending
request more accurate, the annual approach of “fix things during the mid-year
review,” had been replaced by consideration of long-term spending impacts. As a
result these impacts were being discussed and changes were being
institutionalized. An example of this is the eventual adoption of a permanent
reserve for the city. Its purpose was to buffer the impacts of revenue calculations
that fell short of expectations and augmenting revenues needed during natural
disaster or economic downturns.
In retrospect, Auburn has viewed its conversion to be an undoubted success. It
had reduced the staff involved in budget preparation and review, enhanced the
security of its fund balance and built a paradigm of long term planning. Auburn,
with the intended results of additional savings of both time and resources, has
since developed several policy and process improvements in order to further
simplify the budget process.
Page 14
Biennial Budgeting: Perspectives from the State & Local Level
& For the Municipality of Anchorage This next section will examine the implications inherent in applying biennial
budgeting systems to provide a evaluative perspective for the Municipality of
Anchorage. In order for a biennial budget to be successfully implemented it must
represent more than simply a mechanism to save municipal time and resources.
There must be a broad commitment by all the key players of the budget process,
the Mayor, the Assembly, and all the various public entities and departments that
make up the Municipality, to the values and goals of long term fiscal planning. “If
created carefully, biennial budgets can act as a catalyst to move government from
line-item consideration of the budget and instead focus upon increased long term
planning with a reduction of the amount of time spent annually crafting the budget.
However, there is nothing inherent in biennial budgeting that assures that this
transition will take place.” (City & County of San Francisco, Legislative Analyst Report,
File 021309, October 2002)
In reviewing available literature on biennial budgeting, the attempt to establish a
definitive position on whether or not the implementation of such a system is
advantageous or not was inconclusive. Ronald Snell, in his “Annual & Biennial
Budgeting: The Experience of State Governments” report to the National
Conference of State Legislatures draws upon reports made by the 1972 Council of
State Governments and a study by analysts at Texas A&M in 1984 to conclude
that “ a state can develop a good system of executive and legislative fiscal and
program planning and controls under either an annual or biennial budget.” (Snell,
Annual & Biennial Budgeting: The Experience of State Governments, October 2, 2004)
Snell continues, “There is little evidence that either annual or biennial state
budgets hold clear advantages over the other. Evidence from the past is
inconclusive on the question whether biennial budgeting is more conducive to
long-term planning than annual budgeting is. Some evidence indicates that
Page 15
biennial budgeting is more conducive to program review and evaluation. Biennial
budgeting is likely somewhat to reduce budgeting costs for executive agencies,
but it also is likely to reduce legislators' familiarity with budgets. States with
biennial budgets and biennial legislative sessions do not appear to have given
greater authority over budget revision to governors than other states have.
Forecasting is likely to prove more accurate in annual-budget states than in
biennial-budget states, reducing the need for supplemental appropriations and
special legislative sessions. In the short run, economic conditions largely
determine how efficiently a state budget is enacted and whether it requires
extensive change in the course of administration. In the long run, the political
expectation that state operations budgets will be balanced annually or biennially is
one of the basic controlling elements of state budgeting, far more important than
the length of the budget period or the frequency of legislative sessions. (Snell,
Annual & Biennial Budgeting: The Experience of State Governments, October 2, 2004)
Public officials must work in concert to assure the success of biennial or multi-year
budgetary systems. In 1984 a Texas A&M review opined that: “The success of a
budget cycle seems to depend on the commitment of state officials to good
implementation, rather than on the method itself.” The degree of cooperation
between executive and legislative leadership is key to the success of any
budgeting system. Biennial budgeting has not been demonstrated to increase or
reduce the degree of cooperation. (Municipality of Anchorage Office of Management &
Budget)
If the system itself is not enough to ensure success, how can the case be made for
moving from an annual to biennial budgetary process?
At this point it is important to re-summarize what we know so far regarding the
generally agreed upon conceptual pro & con arguments for biennial budgets.
Page 16
ADVANTAGES OF BIENNIAL BUDGETING • Better Long-range and Strategic Planning: A biennial budget requires forecasting
expenditures and revenues up to thirty months in advance; thus departments and policymakers are considering longer time horizons for resource and program planning purposes.
• Staff Redeployment Opportunities: The biennial budget offers an opportunity to
redeploy the central budget staff during the first year of the biennial budget to focused program evaluations, capital improvements programming, or policy development. It also frees up departmental staff that would otherwise be working on budget to attend to programmatic issues.
• Policy Emphasis: Although not always an intended result, the policymakers often
move away from a detail, line-item approach to a more policy-oriented budget during a biennial budget process. This often allows more discretion for the management team and focuses the policy makers on results instead of attempting to micromanage the programs.
• Time Redistribution: It is generally agreed that biennial budgeting can save staff
time. Generally, that time is redistributed in that more work goes into the development of the biennial budget and then much less work is required during the mid-biennium review. This also can be true for the policymakers.
(Municipal Research & Services Center of Washington, Biennial Budgeting for Cities & Counties, February 2000)
DISADVANTAGES OF BIENNIAL BUDGETING Revenue Forecasting Difficulties: In a dynamic economy, accurately forecasting revenues up to thirty months in advance is extremely difficult. Witness the State of Washington revenue forecasts that change, often dramatically, throughout the biennium. In a scenario where the local economy may slow during the two-year cycle, biennial budgets can be a real problem. Many experienced practitioners recommend only budgeting biennially when economic conditions are stable. Additionally, projecting federal and state shared revenues and mandates can be nearly impossible that far in advance. The fact that counties rely more heavily on state and federal revenues than cities might give some insight as to why fewer counties than cities have moved to a biennial budget process. Less Responsiveness: A biennial budget can make it more difficult to adapt to changing economic and/or programmatic conditions. A biennial budget does not typically provide for major program changes during the biennium. However, most Washington cities do not report major problems in this regard. They simply make budget adjustments when necessary. Financial Software Changes: Most often, financial software is not set up to allow biennial budgeting and/or reporting. Sometimes it requires expensive reprogramming.
Page 17
Workload Stress: The conversion to a biennial budget process can require much more work in the first budget development cycle on the part of central budget staff and department staff. (Municipal Research & Services Center of Washington, Biennial Budgeting for Cities & Counties, February 2000) Knowing the pros & cons, what steps should policymakers take to begin the
process? Displeasure and impatience with the amount of time spent putting
together annual budgets are sentiments not uncommonly expressed by both the
general public and policymakers. The general public sees the process as
dysfunctional -- executive and legislative branches at all three levels of
government are perceived year after year as constantly competing for supremacy
over short term or stop gap spending measures rather than working together in an
attempt to build comprehensive long term fiscal plans. Mistakes in forecasts or
planning are simply corrected or adjusted by using supplementary spending bills
thereby causing the general public to view the whole process as one tainted by
unaccountability. Public policymakers are equally frustrated with aspects of the
annual budget system as critical time and resources are completely focused for a
large portion of the fiscal year on simply the process of preparing, reviewing,
negotiating, revising, and finalizing. Many wonder if such time might be better
spent on public policy.
While Juneau is the only governmental entity in Alaska to utilize a biennial
budgetary system, there have been attempts to introduce the biennial system at
the state level. In 2001 then-House Representative Lisa Murkowski proposed an
amendment (HJR 2) to the Constitution of the State of Alaska “relating to a
biennial state budget” in an effort to promote efficiency and effectiveness in state
government.” (Sponsor Statement HJR 2, Rep. Lisa Murkowski, March 13, 2001)
Murkowski’s explanation for the amendment was as follows, “As it currently
stands, the state budget process is a tedious annual event. This process involves
hearings, debates, and closeouts with considerable time spent by the various
departments drafting their budgets. Once the agencies have prepared a budget,
Page 18
they must defend and revise, with little time for actual implementation before they
start all over again preparing for the next year. A biennial budget would allow
agencies to devise their budgets for two fiscal years, giving more time to
implement the budget and allow for advanced planning initiatives. This would
result in cost efficiencies and greater productivity overall. With a biennial budget,
the "off-year" would then be focused on legislative issues and priorities other than
the budget. The off-year length of the session could be significantly reduced from
120 days to just 60 days and be a further cost savings to the state. It should be
noted that HJR 2 does not limit other legislation to just the off year, it would be
business as usual with the exception that the budget would be tackled during the
first year. As a resource state, we recognize that Alaska's annual revenue is a
moving target. HJR 2 responds to this by allowing for a supplemental budget
during the off year as needed, without going through the expense and hassle of a
full budget review.” (Sponsor Statement HJR 2, Rep. Lisa Murkowski, March 13, 2001)
Former Speaker of the House, Gail Phillips (R-Homer) had also introduced a
similar amendment in 1997, but was not successful in bringing the amendment to
a floor vote. Similarly, despite the intriguing argument, the bill ultimately ended up
being referred to the State Affairs, Judiciary, and Finance Committees and there
has not been any significant legislative or executive movement towards
resurrecting the issue since that time.
Conceptually, it is not difficult to understand why the merits of implementing
biennial budgeting continue to be so compelling for many in and outside of the
budget process. Yet, despite these merits, the historical trend seems to be moving
against biennial budgets. “The trend among state governments for the past sixty
years has been to abandon biennial budgeting for annual budgeting. Forty-four
states practiced biennial budgeting in 1940. Twenty-one do so now. There were
several reasons for the shift to annual budgeting, but in general the shift has been
part of the resurgence of state legislative power since the middle of the century. In
the past decade, however, two states have returned to biennial budgeting from
Page 19
annual budgeting, and no state has shifted from biennial to annual budgeting.” (Snell, Annual & Biennial Budgeting: The Experience of State Governments, October 2,
2004).
Among those twenty-one states that implement some form of biennial budgeting,
only three states, Oregon, North Dakota and Wyoming produce a truly
consolidated two-year budget. Are there commonalties that these states share
that makes biennial budgeting preferable? Although the PEW Foundation’s
Government Performance Project’s Grading the States Project 2005 provides a
means for comparing state government performances in the area of money,
people, infrastructure, and information it is difficult to make conclusive
determinations as while North Dakota (B-) and Wyoming (B) both received high
marks for long term fiscal planning, little debt, Oregon received a “D” in its ability to
manage its finances.
The report said “Oregon’s long-term budgeting perspective is problematic, and the
state has not passed its budget on time in the last decade. The state has also
relied on many revenue and expenditure measures to reach budget balance in
fiscal years 2003 and 2004. Oregon’s tax structure is terribly imbalanced. A lack of
diversification has left the state facing continuous multi-million dollar shortfalls.”
(Government Performance Project’s Grading the States Project 2005) Structural
similarities alone do not seem enough to explain why certain states have turned to
biennial budgeting and others have not.
For a nationwide comparison of states employing annual and biennial budgets,
refer to Table 2.
Page 20
Table 2
Annual and Biennial Budgeting States (Boldface Indicates the 10 Most Populous States)
Annual Session Annual Budget
(29 States)
Annual Session Biennial Budget
(15 States)
Biennial Session Biennial Budget
(6 States) Alabama Alaska
California Colorado Delaware Florida Georgia
Idaho Illinois Iowa
Kansas Louisiana Maryland
Massachusetts Michigan Mississippi
Missouri New Jersey New Mexico New York Oklahoma
Pennsylvania Rhode Island
South Carolina South Dakota Tennessee
Utah Vermont
West Virginia
Arizona+ Connecticut
Hawaii Indiana
Kentucky Maine
Minnesota Nebraska
New Hampshire North Carolina
Ohio Virginia
Washington Wisconsin Wyoming*
Arkansas Montana Nevada
North Dakota* Oregon* Texas
*Biennial budget states that enact a consolidated two-year budget. Other biennial budgets enact two annual budgets at one time. + In Arizona, biennial budgeting is limited to smaller state agencies. Population estimates are for 2000.
(Snell, Annual & Biennial Budgeting: The Experience of State Governments, October 2, 2004)
Rather than looking at institutional characteristics of the budgeting process, it
appears as if the most important component of successful biennial budgeting is
philosophical. Whalen, in his paper Biennial Budgeting for the Federal
Government: Lessons from the States, writes “Although a rash of missed budget
deadlines increased general interest in biennial budgeting during the 1980s,
proponents of this reform often stress that meeting deadlines with biennial
Page 21
budgeting will remain difficult. Budgetary decisions are political decisions, which
cannot be made easier by procedural revision. The case for two-year budgeting
does not include the promise of bipartisan fiscal harmony and timely budget
agreements, it centers on the belief that a biennial budget and appropriations cycle
will streamline the process, make federal policies more effective, and promote
economic stability.” (Whalen, Biennial Budgeting for the Federal Government: Lessons
from the States, 1995, p. 306)
In terms of streamlining the process, the arguments are similar to those stated
earlier in this paper, supporters tout biennial budgeting as it “ relieves participants
of many routine and repetitive activities, allowing them to use their time more
efficiently. They maintain that biennial budgeting would make more time and
resources available for service delivery, agency management, oversight, and long-
range analysis.” (Whalen, Biennial Budgeting for the Federal Government: Lessons from
the States, 1995, p. 306) Conversely, opponents of biennial budgeting claim that it
“leads to more work at nearly every stage in the budget cycle. They contend that
there would be additional work in the preparation stage due to the extended fiscal
period, that budget agreements would be more difficult to reach because the
biennial process raises the stakes, and that unexpected but inevitable changes
(e.g., war, recession, or natural disaster) would lead to frequent fiscal adjustments
during the budget period. Another concern is that budget work would expand to fill
the time available.” (Whalen, Biennial Budgeting for the Federal Government: Lessons
from the States, 1995, p. 306)
See Table 3 for findings relating to the success of biennial budgeting systems in
streamlining the budgetary process.
Page 22
Table 3
DO BIENNIAL BUDGETS STREAMLINE BUDGETING? PREVIOUS STUDIES AND THEIR FINDINGS
STUDIES AND METHODS
NATIONAL CONFERENCE OF STATE LEGISLATURES (SNELL, 1994) Summarized findings of past studies and in house research
U.S. GENERAL ACCOUNTING OFFICE (KIRKMAN, 1987) Surveyed state budget officers and legislators in every state
U.S. GENERAL ACCOUNTING OFFICE (BOWSHER, 1984) Interviewed officials in three large biennial-budgeting states
PUBLIC POLICY RESOURCES LABORATORY (WIGGINS AND HAMM, 1984) Interviewed officials and observers in states moving to annual budgeting between late 1960s and early 1970s; also surveyed agency heads and lobbyists in Texas on possible adoption of annual state budgeting
COUNCIL OF STATE GOVERNMENTS (COUNCIL OF STATE GOVERNMENTS, 1972) Surveyed officials in 11 states experiencing budget process reform after World War II
Findings Moving to biennial budgeting yields a substantial reduction in budget preparation work; allows
budget staff more time for analyses associated with budget planning; enables public managers and legislators to more closely scrutinize program operations, accomplishments, and problems.
Moving to annual budgeting increased budget preparations workloads and costs; less time for budget execution, consideration of substantive issues, provision of management services, and research into program improvements.
More time devoted to budgeting under an annual system is not seen as necessarily producing better budgets; public officials note that biennial budgets may be considered more "deliberatively."
States with biennial budgets maintain that their system allows public officials more time for management, oversight, and other activities beyond budget preparation and approval.
Evidence is mixed on whether states with biennial budgeting rely more frequently on budget adjustments (i.e., supplemental appropriations and recissions) than those with an annual budget process. One study finds "a slight indication of decreased adjustments" in annual-budgeting states. Most research indicates that no strong pattern emerges here.
Under biennial budgeting, a thorough off-year budget review procedure is reported to have an adverse effect on policy development and administration; however, off-year budget work is still only one-third as time-consuming as annual budgeting.
(Whalen, Biennial Budgeting for the Federal Government: Lessons from the States, 1995, p. 308)
In terms of the questions of whether or not biennial budgeting improves
policymaking and promotes economic stability, as concluded by the findings in
Table 3, it is still difficult to come to definitive conclusions about the superiority of
implementing two-year budget schedules. “A streamlined budget process cannot
by itself guarantee better government policies. Programs and agencies can only
Page 23
be improved if members of the executive and legislative branches commit
themselves to making the public sector function more effectively. A participant in
one budgeting study said, ‘If you have no destination, any road will take you
there’.” (Whalen, Biennial Budgeting for the Federal Government: Lessons from the States,
1995, p. 312)
Opinion is also mixed as to the ability of biennial budgets to promote economic
stability. “Supporters of biennial federal budgeting assert that two-year budgets
promote stability at the macroeconomic level and at the level of specific
individuals, agencies, and corporations. Opponents respond that stability comes
only at the expense of two important features afforded in the present system:
flexibility and congressional control over the budget and the executive branch.
Whether economic priorities and policies can be maintained for two years at a time
leads some to argue that a biennial system will be insufficiently responsive to both
changing circumstances and the public interest.” (Whalen, Biennial Budgeting for the
Federal Government: Lessons from the States, 1995, p. 312-313)
Whalen concludes in his analysis that, “fiscal theory does not identify one budget
period as being universally appropriate. Annual budgeting is not inherently
superior to multi-year budgeting. An appropriate budget period can be identified
only after one weights the advantages and disadvantages of alternate
arrangements.” (Whalen, Biennial Budgeting for the Federal Government: Lessons from
the States, 1995, p. 316) What does appear do be a controlling factor is the
philosophical commitment of all key players in the budget process to the goals of a
biennial budget – long term planning with the goal of ensuring fiscal and economic
stability. Whalen writes “ Biennial budgeting does not make budgeting less difficult.
Even under a biennial system, budgeting remains at the heart of the political
process. Budgets are inherently both a product and a source of political conflict.
Moreover, much more than the budget period determines the effectiveness of
budgeting--relevant factors range from the legislature's committee structure to the
degree to which participants in the process are committed to following established
Page 24
procedures.” (Whalen, Biennial Budgeting for the Federal Government: Lessons from the
States, 1995, p. 316)
Given Alaska’s current fiscal situation, and its continued long-term dependence on
revenues from the federal government and the petroleum industry, what are the
prospects for biennial budgeting here? In 1991, the Alaska Division of Legislative
Audit attempted to answer that question in a report prepared for the Legislature’s
Legislative Budget and Audit Committee titled “The Cost of Preparing Alaska’s
Annual Budget and the Advantages and Disadvantages of Biennial Budgeting. “
Under assumptions that subsequent legislative, executive, and judicial
involvement would be receptive to the priorities and level of services budgeted for
under a biennial process for the current biennium; that actual revenues would not
fall significantly below that budgeted for either year in the biennium; that annual
appropriation would occur as required by the Alaska Constitution; and that biennial
budgets would have two years presented in one set of budget documents, not two
complete sets of budget documents, the report concluded by saying that such a
system would not be fiscally viable for Alaska. (Alaska Division of Legislative Audit, A
Special Report On The Cost Of Preparing Alaska's Annual Budget and The Advantages and Disadvantages Of Biennial Budgeting, March 22, 1991)
The reports conclusions were as follows: “A biennial budget is not practical for the State of Alaska because of historical
fluctuations in revenues. Significant revenue fluctuations and annual
appropriation by the Legislature may result in redevelopment of the biennial
budget in the off-budget year. Also, we believe that if the State changes to a
biennial budget preparation, implementation will be costly and the system may be
less responsive to the public.
A large percentage of state revenues is petroleum-related and, as such, involves
a number of uncertainty factors, the most volatile of those being price. Revenue
forecasting becomes increasingly relevant as the supply of oil in Alaska declines.
If actual revenues fall significantly below budgeted expenditures presented in a
Page 25
biennial budget, the cost-saving benefit of biennial preparation is lost because
legislative, executive, and judicial staff will be required to redevelop the budgets
to recognize reductions.
If legislative personnel desire review of the budget documents in the off-budget
year, which requires executive agency attendance at subcommittee meetings,
presentation time, travel costs, and adjustments to budget documents, cost
savings will not be recognized. Legislative review annually may be necessary in
order to be responsive to the public. Currently, Alaska Statute 37.07.010 requires
the budget system to include procedures for public participation in the
development of an annual budget. Biennial review also may not be perceived by
the public as allowing adequate lobbying or participation.”
(Alaska Division of Legislative Audit, A Special Report On The Cost Of Preparing Alaska's Annual Budget and The Advantages and Disadvantages Of Biennial Budgeting, March 22, 1991)
While conditions on the state level have not changed measurably over the last
fourteen years, there is a very successful example of biennial budgeting on the
local level. The City & Borough of Juneau (CBJ) has employed a biennial budget
system since 1996. As official policy, the budgetary system is defined by the CBJ,
as follows: “A balanced budget will be prepared every other year as a biennial
budget. In the first year of each two-year budget, the Assembly will adopt the first
year’s budget and approves, in concept, the second year’s budget. The
conceptually approved 2nd year budget will be brought back before the Assembly
for adoption in the following year. A balanced budget is one in which proposed
expenditures do not exceed total estimated revenues and reserves.” (Official
Website City & Borough of Juneau)
Juneau public officials have embraced the approach as a positive step towards
long-term fiscal stability. “The City and Borough of Juneau's budget process
requires the City Manager to develop and present to the Assembly a balanced
budget every year. This budgeting process consists of biennial, two-year, budgets
every other year with second year follow-ups. The Assembly adopts the first year
Page 26
of the biennial budget and approves, in concept, the second year. In the second
year, the City Manager submits the conceptually approved budget, with necessary
revisions, to the Assembly. The biennial budget process helps improve long-term
planning while reducing the amount of time spent in overall budget development.
The Biennial Budget process also helps to minimize second year budget
changes.” (Official Website City & Borough of Juneau) The CBJ Budget Schedule is
shown in Table 4. Table 4
Page 27
According to Craig Duncan, Finance Director for the CBJ, the system has worked
well “We were able to work through most of the legislative issues. Our Charter
does contain some requirements on how we prepare and present our budget. It
also requires us to adopt the budget annually. So while we do prepare a biennial
budget every other year, we actually adopt the budget annually. Because our
budget process calls for a limited review in the second year of each biennial
budget period, we have not felt it necessary to ask the voters to change the annual
adoption provision.” The biggest technical/practical issue was year-to-year
consistency. Generally the stability of revenues is the biggest issue. After
reviewing our revenue sources, we decided that a biennial budget could work.
However, everyone agreed that it would be necessary to make some second year
adjustments. So far, the process has been working well. While the process does
require extra staff efforts in the first year of each biennial budget period, the
resource savings in the second year more than make up for the extra efforts in the
first year.” (Craig Duncan, Finance Director, City & Borough of Juneau)
Could Juneau’s success be replicated in the Municipality of Anchorage? Available
literature all describes the budgetary process as one that creates great pressures
for budget staff and policymakers. For government officials and public
administrators, the annual process involves literally working on three budgets at
one time. They prepare for the next fiscal year while at the same time
implementing the current-year budget and completing the review process and
paperwork relating to the previous year's budget. Biennial Budgeting provides an
alternative that allows policymakers to enact budget legislation one year and to
oversee and evaluate program results in the next. (California Performance Review
Report, 2004)
Authority for the budget in the Municipality of Anchorage is statutory. In Article XIII
(Finance) of the Anchorage Municipal Charter Section 13.01 the following sections
define the fiscal year. These sections were identified in previous Municipality
Page 28
research on biennial budget prospects as relevant for review should the
Municipality decide to make the switchover from an annual to biennial system:
Anchorage Municipal Charter, ARTICLE XIII
Section 13.01. Fiscal year The assembly by ordinance may change the fiscal year of the municipality. The assembly by ordinance may change the fiscal year of the school district to the extent permitted by law. A change in fiscal year may not take effect until at least one year after enactment of the change. Section 13.03. Operating & Capital budget At least 90 days before the end of the fiscal year of the municipality the mayor shall submit to the assembly a proposed operating and capital budget for the next fiscal year. The form and content of the budget shall be consistent with the proposed six-year program. The mayor shall submit with the budget an analysis of the fiscal implications of all tax levies and programs. Section 13.04. Budget hearing The assembly shall hold at least two public hearings on the proposed operating and capital budget for the next fiscal year, including one hearing at least 21 days after the budget is submitted to the assembly, and one hearing at least seven but not more than 14 days prior to the adoption of the budget. Section 13.06. Reduction and transfer of appropriations (a) If the mayor determines that revenues will be less than appropriations for a fiscal year, the mayor shall so report to the assembly. The assembly may reduce appropriations, as it deems necessary. No appropriation may be reduced by more than the amount of the then unencumbered balance. (b) Except as to the school budget, the mayor may transfer all or part of any unencumbered balance between categories within an appropriation. The school board may transfer part or all of any unencumbered balance between categories within the appropriation for the school budget. Except as to the school budget, the assembly may transfer part or all of any unencumbered balance from one appropriation to another. (Anchorage Municipal Charter& Municipality of Anchorage Office of Management & Budget)
Earlier Municipality analysis on the potential for biennial budget implementation
concluded the following: ‘the Anchorage Municipal Charter does not appear to
restrict biennial budgeting. The attached document sets out Finance, Article XIII of
the Charter. The boldfaced provisions are marked because they relate to the
timing of events. Most set minimum or "at least" standards, rather than "not
before"-type provisions. One exception is the second assembly budget hearing,
but this sets a required relationship to the adoption of the budget. None of the
Article XIII charter language seems to restrict how far in advance a given fiscal
year's or years' budgets could be adopted. In fact, the only two references to
Page 29
"annual" in this charter Article are to "annual audit" and "annual inflation". Neither
would require revision.” (Municipality of Anchorage Office of Management & Budget)
Earlier analysis also provided draft language for changes to the Anchorage
Municipal Code in Chapter 6.10 relating to “BUDGET AND APPROPRIATIONS
GENERALLY.” Code language in section 6.10.030 would be revised to say:
6.10.030 Preparation of budget “The director of the office of management and budget shall present to the mayor the BIENNIAL BUDGET for the ensuing TWO fiscal years. The budget shall be based upon detailed estimates furnished by the agencies of the municipal government according to a classification as nearly uniform as possible. The budget shall present information on recommended appropriations, anticipated expenditures, estimated taxes and other revenues required to support the budget. The proposed BIENNIAL BUDGET submitted to the assembly shall also include, on the reconciliation worksheets, a continuation funding level for each agency, and a total continuation level for the budget comparing the ensuing year's budget to the current year's revised budget. The chief fiscal officer shall provide fiscal input to the preliminary stages of the budget preparation, and again when the office of management and budget consolidates agency requests. The chief fiscal officer shall provide funding certification prior to the mayor's administrative review, and upon assembly adoption the chief fiscal officer is responsible for budget execution and administration and pre-audits and post-audits. Municipal funds and grants which have been appropriated by the assembly to institutions and nonprofit organizations for the benefit and welfare of the public shall be controlled by conditions and regulations as may be imposed by the assembly and shall be subject to independent financial audit under the same procedures as established for municipal funds. The office of management and budget shall perform program evaluation.”
(Municipality of Anchorage Office of Management & Budget)
Other relevant sections would then be amended to reflect “biennial” rather than
“annual” references to the length of the fiscal year. Potential issues, however, do
exist with the differences between budget and mayoral election cycles. In Juneau’s
situation, the problem was not as pronounced as their form of government differs
from the Municipality in the sense that Juneau has a strong city manager system.
Their charter places the responsibility for presenting the budget with the City
Manager and not the Mayor. (Craig Duncan, Finance Director, City & Borough of
Page 30
Juneau) Therefore a change of Mayors does not pose significant impacts to the
biennial budget system between years as his/her vote represents only 1 of 9
participants in the decision-making process. (Craig Duncan, Finance Director, City &
Borough of Juneau) However, in the case of the Municipality, this issue would have
to be addressed, as biennial budgets tend to give the executive branch of
government more discretion and thereby more authority in fiscal policy. Although
as Snell says “in years when political leadership and economic circumstances are
unchanged, budget processes can be fairly routine, regardless of whether an
annual or a biennial budget is being written,” this would not be true in the case of
the Municipality where Mayors serve three year terms and two enacted biennial
budgets would cover four years. (Snell, Annual & Biennial Budgeting: The Experience of
State Governments, October 2, 2004)
Such a conflict could be avoided if a rolling budget type approach (the budget
contains detailed appropriations & anticipated revenues for two or more budgetary
periods, but each spending plan is approved individually each year) was taken
with flexibility afforded to the second year. (An Elected Officials Guide to MULTI-YEAR
BUDGETING, 2000, p.17) Since the end of the first year for biennial budgets generally
involve a mid-point review, a new administration would be allowed discretion in
revising or changing particular aspects of the budget. Details regarding the extent
of such discretion could be determined and debated by the Municipality and the
Assembly with final recommendations to be made available for public comment
prior to execution and implementation of such revisions.
Currently, the Municipality has nine staff members in its Office of Management &
Budget, and they spend approximately nine months every year on preparing the
annual operating and capital budgets. (Municipality of Anchorage Office of Management
& Budget) Additionally, every municipal department has an individual with budget
responsibility, and it is estimated that individual spends at least two months of the
work year on budget preparation. (Municipality of Anchorage Office of Management &
Budget) A rolling biennial budget system could provide the opportunity to save staff
time and allow for multiple reviews, which would be a step towards more long-term
Page 31
fiscal efficiency as opposed to the annual system, which in the case of the
Municipality only allows for review and action at the approval and 1st quarter
budget phase. (Municipality of Anchorage, Office of Management & Budget) If a rolling
biennial system was adopted, non-binding two-year spending plans could be
submitted while maintaining the option to continue to appropriate funds annually.
Building and achieving truly substantive long-term fiscal goals is difficult given the
context of the annual budget system. As noted earlier in this report many
governmental entities spend the majority of their fiscal year attempting to simply
manage three budgets at one time (those of the past, present and future fiscal
years). Under such pressures, it is almost impossible to build a lasting long-term
fiscal plan. Rolling biennial budgets would help to alleviate some of that pressure
and it would also offer flexibility in dealing with election cycles as potential new
administrations would have discretion to make changes to the non-binding year of
the budget. Another factor for consideration in winning support for such a change
would be the ability to demonstrate revenue source stability. The more volatile and
uncertain the sources of municipal revenues, the more difficult it becomes to build
a stable long term fiscal plan. Such a discussion would also have to be a part of
the overall evaluation process.
In addition, there would be some technical challenges to make the switchover to a
biennial budget system. The Municipality’s current computer system is twenty
years old and would have to be upgraded to handle the change. Discussion
regarding the issue of system upgrade is currently underway to at least make the
system more user-friendly and efficient. Additionally, there would have to be
amendments to Anchorage’s Municipal Charter. Any change to these provisions
would require a vote of the people because that is the only way to amend the
Charter. One way to adapt a biennial budget could be implemented through an
amendment to the Charter (which always requires a vote of the
people). (Municipality of Anchorage, Municipal Attorney’s Office)
Page 32
However, that is not the only option for making such a change. “Amending the
Charter is not the only way to get to the same result in practical terms. For
example, the Assembly could enact an ordinance directing the mayor to submit a
biennial budget (and to do so every other year thereafter) it could then approve
either only the first year or both years. At the end of the first year there would
likely be certain revisions or amendments to the second year budget and those
could be considered in an abbreviated process. Thus, there would be an approval
(or simply a reapproval in actuality) for the budget’s second year. Such an
approach would be essentially two-year budgeting and would still be compliant
with the Charter. In this case, no amendments to the Charter would be required
and therefore a vote of the people would not be required.” (Municipality of
Anchorage, Municipal Attorney’s Office)
Whatever the form, the Government Finance Officer’s Association says that there
are four overriding principles that should guide budget development and
implementation: Principle I – Establish Broad Goals To Guide Government Decision Making A government should have broad goals that provide overall direction for the government and serve as a basis for decision-making. Principle II – Develop Approaches to Achieve Goals A government should have specific policies, plans, programs, and management strategies to define how it will achieve its long-term goals. Principle III – Develop a Budget with Approaches to Achieve Goals A financial plan and budget that moves toward achievement of goals, within the constraints of available resources, should be prepared and adopted. Principle IV – Evaluate Performance and Make Adjustments Program and financial performance should be continually evaluated, and adjustments made, to encourage progress toward achieving goals.
(Official Website of Government Finance Officer’s Association)
These principles establish what should, ideally be the conceptual foundation for
every budget at every level of government – a long-term plan with tools and a
mechanism developed and in place to achieve the goals of that long term plan.
Page 33
However, governments do not last very long if they base their decisions on
idealistic conceptions. There must be a balanced mix of theory tempered by
practice. Poor fiscal policies will not be rescued by the introduction of biennial
budget systems. However, they can help to improve financial management
practices in local government. The list below outlines the steps necessary to
successfully executing a biennial budget.
Keys to Successfully Implementing Biennial Budgets: Amending existing financial & budgeting policies & procedures
Assessing the local economic environment by examining key economic and fiscal indicators
Conducting an analysis of the existing revenue structure
Updating the budget manual to reflect the changes in the budget processes
Documenting and specifying underlying economic assumptions
Effectively communicating the need for a multi-year budget with key stakeholders
Establishing a budget review process for ensuring compliance with budget polices, processes,
and targets
Linking the multi-year budget with the strategic plan, long-range financial plan and revenue forecast, and financial and budgetary policies
Preparing the budget staff in advance regarding the implementation of the multi-year budget
(Guajardo, An Elected Official’s Guide to MULTI-YEAR BUDGETING, 2000, p.18)
Conclusion Biennial budgets are not, as mentioned earlier, panaceas for all the problems and
challenges of the budget planning and implementation process. Biennial budgets
are not substitutes for good planning, and neither will they provide a cover for poor
planning. Biennial Budgets can, however, with proper commitment, link operating
and capital planning and spending activities, and improve long range and strategic
planning to create fiscal policies that are more efficient and more effectively
monitored and evaluated.
Page 34
References Anchorage Municipal Charter http://www.municode.com/services/mcsgateway.asp?sid=31&pid=13397 Alaska Division of Legislative Audit, A Special Report On The Cost Of Preparing Alaska's Annual Budget and The Advantages and Disadvantages Of Biennial Budgeting, March 22, 1991 Biennial budgeting’s implications. Retrieved 3/22/05 www.budgetanalyst.com/Biennial.htm Bockh, L. & Blakeslee, M. (1998-2004). Budget analyst: Federal agency money matters: California Performance Review Report, 2004 http://cpr.ca.gov/ City & County of San Francisco, Legislative Analyst Report, File 021309, October 2002 Government Performance Project’s Grading the States Project 2005 http://results.gpponline.org/ Guajardo, S.A. (2000). An elected official’s guide to multi-year budgeting. Chicago, IL: Government Finance Officers Association of the United States and Canada. U.S. House of Representatives (2000). Hearing of the Committee on Rules: February 16,2000. Retrieved 3/17/05 www.house.gov/rules/rules_tran09.htm. Jackson, Andrea, “Taking the Plunge: The Conversion to Multi-year Budgeting,” Government Finance Review (August, 2002): 24-27 National Advisory Council on State and Local Budgeting (1998). Recommended budget practices: A framework for improved state and local government budgeting. Chicago, IL: Government Finance Officers Association. Municipality of Anchorage, Office of Management & Budget Municipality of Anchorage, Office of the Municipal Attorney Municipal Research & Services Center of Washington, Biennial Budgeting for Cities & Counties, February 2000 Murkowski. L, Office of Representative, Sponsor Statement HJR 2, March 13, 2001 Official Website of Government Finance Officer’s Association http://www.gfoa.org/ Official Website City & Borough of Juneau www.juneau.org Sutberry, T. (1998). Biennial budgeting in Washington cities and counties: Government finance review, August 46-47. Snell. R, Annual & Biennial Budgeting: The Experience of State Governments, October 2, 2004 Whalen, Biennial Budgeting for the Federal Government: Lessons from the States, 1995